Now more than ever, technology is influencing the way we do business, communicate, move through and around the world, access and manage our homes, receive and administer healthcare, make purchases, secure information, and protect our most valuable property. Morrison Foerster keeps pace with this rapidly evolving landscape across our internationally recognized corporate, finance, intellectual property, and litigation practices. MoFo Tech brings together our insights relating to fields such as blockchain and distributed ledger, cloud and as-a-service technologies, driverless cars, drones, fintech, computer hardware and software, the Internet of Things, semiconductors, and telecommunications. The MoFo Tech blog offers real-time, in-depth analyses of the trends and complex issues shaping the global technology industry.<h2>ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

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Scott Llewellyn’s practice focuses on complex litigation in federal and state courts around the country, with an emphasis on patent and trade secret disputes. Over the past decade, he has worked on some of the most significant, high–profile IP cases involving technology for televisions, smartphones, and self–driving cars, relying on 40 years of experience with computer hardware and software. Scott also has significant experience with business divorce cases before courts and arbitrators, involving a mix of trade secret, patent, tort, and contract claims relating to technology development and implementation.Scott also has successfully tried general commercial arbitration and agency matters, briefed and argued various appeals in federal appellate court, and tried more than 20 cases for the Denver City Attorney’s office, most of them jury trials.Scott also has an active pro bono practice, having worked on a variety of criminal and immigration appeals, and having represented Colorado criminal defense and mental health organizations in high–profile suits against the state of Colorado for violations of the constitutional rights of defendants.At MoFo, Scott serves on the board of the Morrison & Foerster Foundation. In the broader legal community, he serves on the boards of the Colorado Lawyers Committee and Drop in the Bucket (a charity that builds wells and sanitation systems in sub–Saharan Africa).After law school, Scott clerked for the Honorable Clarence A. Brimmer, District of Wyoming, and the Honorable Diarmuid F. O’Scannlain, Ninth Circuit. He was also previously an adjunct professor at the Georgetown University Law Center.

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Partner

Scott Llewellyn’s practice involves complex litigation before state and federal courts around the country, with an emphasis on patent and trade secret disputes for high-tech companies, to which he brings more than 35 years of experience with computer hardware and software, in particular relating to the processing and transmission of audio, video, voice, and other types of data. Mr. Llewellyn has also tried commercial arbitration and agency matters; briefed and argued various appeals in federal appellate court; and tried more than 20 cases for the Denver city attorney’s office, most of them jury trials.

Scott F. Llewellyn

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MoFo Tech brings together legal insights and in-depth analyses on trends and complex issues shaping the global technology industry, covering fields such as blockchain and distributed ledger, cloud and SaaS technologies, driverless cars, drones, FinTech, computer hardware and software, the IoT, semiconductors, and telecommunications.

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Provides insights and reports on the most current class actions lawsuits and product liability issues that affect consumer-facing companies.

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News and thought leadership from lawyers who are adding value to the legal profession and the communities we call home.

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MoFo Tech brings together legal insights and in-depth analyses on trends and complex issues shaping the global technology industry, covering fields such as blockchain and distributed ledger, cloud and SaaS technologies, driverless cars, drones, FinTech, computer hardware and software, the IoT, semiconductors, and telecommunications.

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Japan’s Approach to AI Regulation in 2025

Federal Circuit Clarifies Requirements for Prior Art Under Pre-AIA 35 U.S.C. § 102(e)

AI Agent as a Service in Medtech - Key Considerations for Commercial Contracts

D.C. Circuit Holds that Works Created Solely by AI are Not Copyrightable

Navigating Inventorship in the Era of AI-Assisted Drug Discovery

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A core strategic question facing life sciences companies developing novel AI-implemented methods is whether to file for patent protection or to keep the methods as trade secret.One successful approach is to develop a hybrid strategy for patents and trade secrets based on current and future company goals, following the considerations outlined in this blog post.Read the <a href="https://lifesciences.mofo.com/topics/patents-and-trade-secrets-in-ai-and-life-sciences" target="_blank">full blog post</a>.

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Associate

Briana’s practice focuses on patent preparation, prosecution, and counseling in the areas of biotechnology, pharmaceuticals, and artificial intelligence.

Briana Erin Mittleman Ph.D.

Briana Mittleman

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Dr. Meghan Poon counsels clients on patent preparation and prosecution, portfolio strategy, and IP due diligence in the areas of biotechnology and biologics. She has significant experience in diverse technologies including antibodies, cell therapies, gene therapies, diagnostics, and gene-edited plants. 

Meghan McLean Poon Ph.D.

Dr. Meghan Poon counsels clients on patent preparation and prosecution, portfolio strategy, and IP due diligence in the areas of biotechnology and biologics. She has significant experience in diverse technologies including antibodies, cell therapies, gene therapies, diagnostics, and gene-edited plants.

Meghan Poon

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Of Counsel

Josh Crawford's practice focuses on domestic patent prosecution, international patent portfolio management, patent infringement and validity determinations, inter partes review proceedings, and IP lit

Joshua A. Crawford

Joshua Crawford

Patents and Trade Secrets in AI and Life Sciences

One of the most noticeable securities litigation trends of 2024 has been the significant increase in artificial intelligence-related fraud claims. With companies in virtually all industries touting their use of AI to drive innovation and productivity, in-house counsel should be mindful that these disclosures may carry heightened risk because of the nascent or unproven nature of many AI technologies.In 2024, the private plaintiffs’ bar filed <a href="https://securities.stanford.edu/current-trends.html#collapse5" target="_blank">13 securities class action complaints</a> alleging that defendants misled investors in violation of federal securities laws when discussing their companies’ AI strategies. As they always do, these plaintiffs evaluated the defendants’ statements with the benefit of hindsight. In general, these “AI washing” cases allege that companies overstated their AI capabilities when subsequent disclosures showed those capabilities failed to live up to the earlier hype. For example, a company offering software tools to automate repetitive business processes announced a rebranding initiative that would focus on AI-powered tools. When it later reported poor quarterly results and its stock price dropped, <a href="https://www.pacermonitor.com/public/case/53990526/Steiner_v_UiPath,_Inc_et_al" target="_blank">a lawsuit</a> soon followed. Separately, a data management company that described itself as a leader in using AI-based software faced a short-seller report alleging that the company’s AI initiatives were “smoke and mirrors.” Its stock price fell steeply when the report was published. Plaintiffs then <a href="https://www.pacermonitor.com/public/case/52400692/DAGOSTINO_v_INNODATA_INC_et_al" target="_blank">sued</a>.Given the centrality of AI strategies for many companies across sectors—and not just “AI natives”—we expect this trend to continue in 2025.Takeaways:<ul><li>Legal should have a seat at the table to review any AI-related disclosures by technical and business teams.</li><li>Whenever possible, frame such statements as clear forward-looking statements that express the company’s hopes and expectations about the possibilities for the technology.</li><li>Because this technology is changing fast, take special care to review and update risk disclosures regularly to confirm they accurately capture the current risks AI capabilities entail for the company.</li></ul>

Pearlstein v. BlackBerry Ltd.

Broadscale OC Investors v. Clayton

Murphy v. Precision Castparts Corp.

Klein v. Ellison et al.

Rosenow v. Facebook.

In re Ocera Therapeutics, Inc.

MaxLinear, Inc.

Technology Storage Company

Energy Company

AI Computing Company

Financial Services Company

Global Venture Investor

Former CFO of Pharmaceutical Company

Private Technology Company

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Christin Hill is a partner in Morrison Foerster’s San Francisco office and a member of the firm's Securities Litigation group.

Christin Hill

Christin Hill is a partner in Morrison Foerster’s San Francisco office and a member of the firm's Securities Litigation group.

Christin J. Hill

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Michael is an associate in the Litigation Department and a member of the firm's Securities Litigation and Securities Enforcement groups.

Michael Komorowski

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Anissa Chitour is an associate in the Litigation Department of Morrison Foerster’s San Francisco office.
Anissa earned her M.A. in Change Management from the Russian Presidential Academy of National

Anissa Chitour

Anissa I. Chitour

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Hanna Lauritzen is an associate in the Litigation Department of Morrison and Foerster’s San Francisco office. Hanna received her J.D. from Columbia Law School, where she was a Harlan Fiske Stone Schol

Hanna Lauritzen

Hanna M. Lauritzen

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Florencio Maldonado

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AI Trends for 2025 - Plaintiffs’ Bar Targets “AI Washing” Disclosures

Copyright fights over material used to train AI models will continue through 2025, and we won’t see a final resolution to those legal questions during the year. But as generative AI tools become more and more important to every sector of the economy, it will become increasingly unthinkable that copyright law should impede their development. The focus will shift to questions about whether particular AI outputs are infringing, and who’s responsible for that infringement.This excerpt is part of a series of 2025 prediction roundups from Legaltech News. Read the <a href="https://www.law.com/legaltechnews/2025/01/07/legal-techs-predictions-for-artificial-intelligence-in-2025/?slreturn=20250303172241" target="_blank">full article</a>.

MoFo partner Joseph Gratz focuses his practice on copyright, patent litigation, trademark, and AI law issues within the tech sector.

Clients turn to Joe Gratz to handle trailblazing litigation where copyright and trademark law meet new technologies. An experienced litigator, Joe draws on his strong technical background to distill complex issues into simple, accurate concepts for judges, juries, and clients.

Joseph C. Gratz

Joseph C. Gratz | Patent Litigation, Trademark & AI Law

Joseph Gratz

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AI Trends for 2025 - Copyright Law's Impact on AI Model Training and Outputs

AI Trends For 2022 - Export Control/CFIUS

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Given the broad impact that emerging and evolving technologies have on consumers, we anticipate that State AGs will continue to use their consumer protection statutes to focus on the technology sector.To start, we expect that State AGs will continue to target social media platforms, particularly related to children’s online safety and privacy. Concurrent with the collective effort by 42 attorneys general to ask Congress for surgeon general warnings to be placed on social media platforms because of their perceived impact on youth mental health, State AGs have sued social media platforms pursuant to state unfair and deceptive practice laws, as well as new laws targeting use of social media by youth. These legislative and litigation efforts will continue, along with State AGs’ significant interest in new technologies, such as AI.States, including California and Massachusetts, already have issued advisory guidance on the development of artificial intelligence (AI) technology. Other state attorneys general have sought to apply traditional deceptive practice claims to AI technology, including, as an example, the Texas AG’s settlement with Pieces Technology related to deceptive claims about the accuracy of its healthcare AI products. We anticipate that State AGs will focus on allegations, particularly by consumers, of misrepresentations by companies about the power and efficacy of their AI tools. Given the evolving nature of the technology, State AGs will likewise continue to be engaged in state legislative and policy development in this area.Lastly, we anticipate that State AGs, as a reflection of bipartisan concerns about China, will continue to seek to enforce consumer protection laws against Chinese technology companies, particularly those operating social media or using AI. The Arkansas AG, for example, has sued Temu, calling it a “data-theft business,” alleging that it “is functionally malware and spyware” and “raises significant security risks.”While the State AGs will continue to broaden the scope and use of their consumer fraud statutes as applied to social media and AI, they also will continue to be active in all aspects of consumer product safety, including filling any gaps, real or perceived, that may result from decreased federal regulation.

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Christine Wong focuses her practice on investigations, white collar criminal defense, and cross-border compliance matters

Christine Wong focuses her practice on investigations, white collar criminal defense, and cross-border compliance matters.

Christine Y. Wong

Christine Wong, co-chair of Morrison Foerster’s Securities Litigation, Enforcement, and White Collar Defense Group, focuses her practice on investigations, white collar criminal defense, and cross-border compliance matters.

Christine Wong

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Digital Compliance in Europe: Regulatory Alignment Post-Brexit

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AI Trends for 2025 - Consumer Protection Efforts by State AGs Focus on AI and Social Media

2024 saw strong interest in M&A involving companies that use or develop artificial intelligence (“AI”) offerings. The rise of AI has brought new issues for companies and dealmakers.<a href="#_ftn1" target="_self">[1]</a> In particular, 2024 saw regulators focusing further on the collection and use of data in AI products, applying existing rules and developing new approaches.For example, in October, the Federal Trade Commission (“FTC”) announced actions against five companies for allegedly deceptive or unfair practices enabled by AI.<a href="#_ftn2" target="_self">[2]</a> This followed the FTC’s complaint in January alleging that Rite Aid Corporation used facial recognition technology “to identify patrons that it had previously deemed likely to engage in shoplifting or other criminal behavior” without appropriate safeguards, including sufficient bias testing. The FTC ordered Rite Aid to, among other things, delete or destroy all photos and videos of consumers collected by the system as well as any data, models, or algorithms derived in whole or in part from them (so-called “algorithmic disgorgement”).<a href="#_ftn3" target="_self">[3]</a>Given the regulatory focus, buyers have increased their scrutiny of data used to train and develop AI products, including the potential for claims relating to:<ul><li>Breach of Contract<ul><li>If customer data was used to train the AI model, did the customer expressly consent to such use (e.g., in the end-user license agreement)</li></ul></li></ul><ul><li>If the data was obtained from a third party, does the license or data aggregation agreement permit the data to be used to train AI models?</li></ul><ul><li>If the AI offering is dependent on the use of a large language model (“LLM”), is the use of the offering permitted by the contract with the LLM provider?</li></ul><blockquote>“2024 saw regulators focusing further on the collection and use of data in AI products, applying existing rules and developing new approaches.”</blockquote><ul><li>IP Infringement<ul><li>Is the AI model trained on and does it regurgitate unlicensed third-party copyrighted works?</li></ul></li></ul><ul><li>If the data was acquired from a third party, does the licensor have the right to make the data available for the applicable use, and what warranties and indemnification has the licensor provided with respect to such data?</li></ul><ul><li>Privacy and Data Protection<ul><li>Does the data include personal data and, if so, were the data subjects provided with any required notice and was any required consent obtained from them?</li></ul></li></ul><ul class="li-text-orange"><li class="li-text-orange">What privacy laws apply to the data (e.g., the EU’s General Data Protection Regulation (“GDPR”) or the California Consumer Privacy Act), and is that something that can be ascertained with confidence (which may not be possible if the data was scraped from public sources)?<a href="#_ftn4" target="_self">[4]</a></li></ul><ul><li>Is the AI model developed in a way that enables the handling of individuals’ rights requests? For example, can the AI model process correction or deletion requests if it outputs incorrect information?</li></ul><ul class="li-text-orange"><li class="li-text-orange">Other Regulations<ul class="li-text-orange"><li class="li-text-orange">Is the target compliant with applicable AI regulations, such as the EU’s AI Act,<a href="#_ftn5" target="_self">[5]</a> and regulations specific to financial, health, and other sensitive information?</li></ul></li></ul><ul><li>Is the target compliant with applicable cross-border data transfer regulations, such as the GDPR, especially where data was scraped in one jurisdiction for processing in another?</li></ul><ul><li>Is the target at risk for claims of allegedly deceptive or unfair use or offering of AI (including with respect to any advertising for the offering), such as by the FTC for deceptive or unfair acts in violation of the FTC Act?</li></ul>Data-related risks can lead to:<ul><li>Delays in dealmaking to conduct “deep dive” diligence to identify data from problematic sources (“dirty data”) and to ascertain the ability to remove or segregate that data.</li></ul><ul><li>A closing condition that dirty data or impacted algorithms be replaced.</li></ul><ul><li>Indemnities and special escrows for the identified risks, including the estimated cost of retraining a model based on clean data if required by a third-party claim or regulatory enforcement.</li></ul><ul><li>An upfront purchase price adjustment.</li></ul><ul><li>Buying a target primarily for its AI systems but being unable to use the systems due to noncompliance with AI, IP, or privacy laws.</li></ul>Companies that use or develop AI offerings should ensure good data hygiene to minimize these risks, especially if they are considering a potential exit transaction.  This blog post is an excerpt from a broader article reviewing the <a href="https://www.mofo.com/resources/insights/250109-m-a-in-2024-and-trends-for-2025" target="_blank">M&A markets in 2024 and the key legal and regulatory issues and trends that will affect deals in 2025.</a><hr class="divider"><a href="#_ftnref1" target="_self">[1]</a> Visit MoFo’s <a href="https://www.mofo.com/artificial-intelligence" target="_blank">Artificial Intelligence Resource Center</a> for updates and insights on AI regulations and issues, including links to laws, regulations, and regulators by jurisdiction.<a href="#_ftnref2" target="_self">[2]</a> See MoFo’s client alert, “<a href="https://www.mofo.com/resources/insights/241008-ftc-first-ai-related-enforcement-actions" target="_blank">FTC Rolls Out Targeted AI Enforcement</a>,” Oct. 8, 2024.<a href="#_ftnref3" target="_self">[3]</a> See MoFo’s client alert, “<a href="https://www.mofo.com/resources/insights/240105-the-ftc-brings-algorithmic-bias-into-sharp-focus" target="_blank">The FTC Brings Algorithmic Bias into Sharp Focus</a>,” Jan. 8, 2024.<a href="#_ftnref4" target="_self">[4]</a> See “<a href="https://iapp.org/news/a/using-special-categories-of-data-for-training-llms-never-allowed-" target="_blank">Using special categories of data for training LLMs: never allowed?</a>” by Lokke Moerel and Marijn Storm, Morrison Foerster, Aug. 28, 2024.<a href="#_ftnref5" target="_self">[5]</a> See MoFo’s client alert: “<a href="https://www.mofo.com/resources/insights/240314-eu-ai-act-landmark-law-on-artificial-intelligence" target="_blank">EU AI Act – Landmark Law on Artificial Intelligence Approved by the European Parliament</a>,” Mar. 14, 2024.

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Chere See is a corporate partner in the Denver office of Morrison Foerster. Chere represents public and private companies in a variety of transactional matters, with a focus on mergers and acquisitions (M&A).

Chere C. See

Chere See

AI Trends for 2025 - Dirty Data Damaging Deals – Data Issues in AI M&A